Stuck in Prosecution?

Stuck in Prosecution?

How certain companies are benefiting from the USPTO’s Fast Track Appeal Pilot Program

By Timothy Nauman, Alan Brandt and Kathryn Chambers

The United States Patent and Trademark Office initiated a pilot program intended to fast track Patent Trial Appeal Board (“PTAB” or “the USPTO”) Ex Parte Appeals. During patent examination, an applicant may have the opportunity to appeal an Examiner’s decision to the PTAB. Traditionally, the average length of time for pending applications is about 33 months.  The average pendency from the application filing date to the USPTO’s decision in an appeal is 77.6 months.[1] Because of this lengthy application pendency, the PTAB recognized a need to “accelerate the pace at which products incorporating new inventions are introduced to the marketplace, thereby stimulating economic growth and encouraging follow-on innovations.”

On July 2, 2020, the USPTO introduced the Fast-Track Appeals Pilot Program. The program runs until July 2, 2021 and will be evaluated for potential continuation. Applicants who utilize this program receive prioritized examination with application pendency lasting no more than 6 months. When an applicant files a notice of appeal for a utility, design, or plant non-provisional patent application, they may file a petition to fast-track under 37 CFR 41.3 for a modest fee of $420. The fee is the same for large, small, and micro entities. However, there are certain stipulations. The Fast-Track Appeals Pilot Program is limited in both time and quantity. The year is divided into four quarters limiting 125 appeals to each quarter with no more than 500 total appeals. If the limit is reached for one quarter, additional petitions are deferred to the following quarter. The applicant may schedule an oral hearing; however, the applicant cannot reschedule or cancel. If an applicant wants to cancel or reschedule the oral hearing, the Fast Track Appeal status is forfeited. The first quarter (July 2-September 2) of the appeals program received 62 petitions as of September 30th. The program is expected to gain popularity, so the earlier the filing of the appeal and petition, the better.

There may be reasons why a client may or may not want to utilize the fast-track program:

The length of patent application pendency can have adverse effects. Specifically, the more time a patent application is spent being examined, or prosecuted, the greater the total costs (higher government fees and attorney’s fees). Longer patent application pendency can also delay enforcement of intellectual property rights. An applicant will not be able to assert its exclusivity rights against potential infringers until a patent has issued. Additionally, longer delays in obtaining exclusivity rights may decrease the value of a patent.

The value of a patent application may depend on how fast the application reaches final disposition, and whether or not the application is granted may affect how soon an invention is commercialized and ultimately the value of the patent. Nonetheless, the length of patent application pendency affects businesses and technologies differently depending on the type of business and area of technology.

For example, tech companies attempting to take advantage of market exclusivity place a high priority on getting whatever patent rights they can as quickly as possible. Likewise, individuals and small to medium businesses may lack the resources to continue through lengthy patent prosecution. Specifically, a first patent for a start-up, the start-up’s employment and sales growth is reduced over a five-year-period by 21-28% for every year of delay in patent application pendency. Delay in patent approval may also adversely impact a start-up’s ability to innovate by delaying subsequent patents. Finally, the start-up’s chances of going public are reduced in half for each additional year of delay.[2] Decreasing the length of application pendency may in turn create more certainty. Uncertainty as to the scope of the claims and patent rights affects patentees, competitors, and new entrants. Reducing application pendency may reduce and make it easier to go through the process of patent prosecution. 

Thus, for tech companies, small to medium businesses, start-up’s, individual applicants, and entrepreneurs, using the fast-track appeals program for a reasonable fee of $420 may be a good option to expedite prosecution during an appeal. This program may increase private patent value and reduce uncertainty.

Some industries, on the other hand, may benefit from a longer patent application pendency. Generally, a shorter application pendency term benefits start-ups and entrepreneurs unless the product or business model is still developing at the time of filing. These newer businesses may need the extra time to decide what particular features of the invention are the most valuable to the business. Marketing and sales schemes may need to be reevaluated with a longer application pendency giving business owners and inventors more time to adapt to the needs of the business. Along these lines, certain areas of technology may actually benefit from the extra time for longer pendency. For example, biotechnological and pharmaceutical companies producing high-cost treatments and larger institutional clients with well-rounded and thriving patent portfolios could take advantage of patent term adjustments, which may produce millions or billions of dollars from the extra months of exclusivity.

Whether a client wishes to accelerate patent application pendency or forego the fast-track appeals program, a patent attorney should be consulted to help provide guidance in this decision-making process. An attorney can thoroughly explain the pros and cons of the fast-track appeals program and consider patent prosecution options with clients. The USPTO expects the program to be popular, so contacting an attorney and considering whether to expedite an appeal, when possible, may be beneficial in optimizing the value of the application and subsequent patent.

[1]This data was reported by the United States Patent and Trademark Office (“USPTO”) as of May 2017. These long application pendency numbers caused the USPTO to establish new programs and set goals to lower the total average pendency of patent application. In the year 2019, the USPTO has been able to reduce the average pendency to 24-29 months.

[2] Joan Farre-Mensa, Deepak Hegde, Alexander Ljungqvist, The Bright Side of Patents, NBER Working Paper No. 21959 (Feb. 2016), Available at: